Jurisdiction(s):
United Kingdom

Key definition

Service charge definition

What does Service charge mean? A service charge is a variable payment made by a tenant, leaseholder or other occupier to a landlord, owner or management/factoring company to recover the cost of providing, maintaining, repairing, insuring and managing common parts and shared services in a multi‑occupied building or estate (residential or commercial). It is typically budgeted annually, demanded on account, and later reconciled by a balancing charge or credit. Apportionment is usually set by the lease or title (for example, a fixed percentage, floor area, rateable value or a “fair proportion”). Demands commonly include managing agent fees and contributions to reserve/sinking funds, and...

RICS Service Charges in Commercial Property (1st ed): status, mandatory requirements, core principles, best practice and key differences from the Code for lawyers drafting and interpreting leases [Archived]

Published by a LexisNexis Property expert

Practice notes

ARCHIVED :

This Practice Note is archived and no longer maintained. The Royal Institution of Chartered Surveyors (RICS) Professional Standard on Service charges in Commercial Property, 1st edition (the Service Charge Standard) (Service charges in commercial property, 1st edition) took effect for all service charge periods starting on 1 April 2019. First released as a professional statement, it was later reissued by RICS as a professional standard in September 2023. RICS stated that ‘[t]he regulatory requirements remain the same and no material changes have been made to the document’. While a first edition professional standard, it nonetheless replaces all earlier iterations of the RICS Code of practice on Service Charges in Commercial Property (the Service Charge Code): see A summary of the main differences between the Service Charge Standard and the Service Charge Code. Note: In June 2025, RICS issued Service charges in commercial property, 2nd edition, which becomes effective from 31 December 2025. For updated and additional guidance in relation to the second edition, see Practice Note: A review of the RICS Professional Standard on Service Charges in Commercial Property (2nd edition)...

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Web page updated on 21/05/2026

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